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<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

Committee Second: Economic and Financial Committee.<br />

Topic: Mitigation of Poverty through Global Partnership; What More We Can Do?<br />

Research Guide for Committee<br />

Introduction<br />

1. Poverty in its various forms has increasingly occupied the attention of the international community<br />

during the last decade. Successive Summits have made commitments to drastically reduce the misery<br />

from which so many humans suffer throughout their lives. Such attention is in itself an encouraging<br />

step forward, but actual progress is still painfully slow, even though measures to improve the<br />

livelihoods of the poor are affordable. Hunger and food insecurity – the most serious forms of extreme<br />

poverty – have now become international priorities, and participants in the 1996 World Food Summit<br />

made a solemn commitment to halve hunger in the world by 2015.<br />

2. The Millennium Declaration of 2000 consolidates and restates the commitments agreed during the<br />

preceding decade, and can be seen as the final stage of the Summit process. For the first time in a<br />

document of its kind, it stresses that, without policies and mechanisms to mobilise private and public<br />

resources on a much larger scale, the internationally agreed Millennium Development Goals<br />

(MDGs) for reducing poverty and hunger and for social and sustainable development cannot be<br />

achieved. The Declaration is thus a starting point for renewed action in the twenty-first century.<br />

The <strong>Ghana</strong> International Model UN Conference can redress the failures and biases of the past by<br />

making its prime objective that of ensuring adequate funding for the achievement of the MDGs.<br />

3. The <strong>Ghana</strong> International Model UN Conference offers the opportunity to put an end to a paradox<br />

that characterized the 1990s: that, while global commitment to progress in the fight against poverty<br />

seemed to be gaining strength and the means to tackle the problem were increasing, the volume of<br />

resources actually mobilized fell year after year. The gap between commitment and action has<br />

widened, which inevitably raises questions about the genuineness of the commitment.<br />

4. This paper looks at financing for the achievement of the MDGs. It does so from the perspective of<br />

FAO, IFAD and WFP, the three Rome-based <strong>United</strong> <strong>Nations</strong> organizations working on food, agriculture,<br />

and rural development issues. The paper shows how widespread hunger is an impediment to overall<br />

growth and poverty reduction efforts. The paper emphasizes that mobilizing and carefully deploying<br />

resources where the impact can be greatest, is fundamental to the effort to reduce poverty, hunger and<br />

food insecurity. In that context it illustrates that resources deployed in fighting hunger directly and in<br />

agricultural and rural development can make substantial and sustainable contributions to overall<br />

poverty alleviation.<br />

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Chairperson’s Remark<br />

<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

I would like to welcome you as a delegate on the second committee on behalf of the bureau. This<br />

committee will deliberate on the topic: “Mitigation of poverty through global partnership; what more<br />

we can do.” I look forward to your co-operation and maximum participation in the discussions of the<br />

committee.<br />

The topic the 2 nd Committee was carefully chosen taking into consideration the first and eighth goals of<br />

the Millennium Development Goal of the <strong>United</strong> <strong>Nations</strong> Organization; namely Eradicating extreme<br />

poverty and hunger and poverty and Developing a global partnership for development, respectively.<br />

Delegates should however note that though discussions at the level of the second committee will be<br />

based on the first and eighth goals, a fair knowledge on the other goals will be necessary as it will<br />

enhance the discussion.<br />

REQUIREMENTS<br />

Each delegate is required to submit his/ her country’s position paper upon arrival. During the committee<br />

sitting, each delegate will be allowed a maximum of 4minutes to present his/ her country’s position on<br />

the topic. Delegates are advised to be very precise in their presentations and clarity of language is highly<br />

recommended.<br />

Taking into consideration the topic for discussion: “Mitigation of poverty through global partnership;<br />

what more we can do,” it is highly recommended that all discussions are channelled towards innovative<br />

and practical ways of mitigating poverty through global partnership.<br />

SUMMARY<br />

Throughout history, countries have had to shoulder their development independently though there was<br />

a great interaction among various countries and nations. In recent times however these walls have been<br />

broken, with the establishment of worldwide bodies to facilitate development issues and the greater<br />

sense of the world as a global village. Thus the topic for discussion; “Mitigation of poverty through<br />

global partnership; what more we can do.”<br />

Though various efforts are being made, there still exists a large divide between the terms of global<br />

partnership and the benefits that the industrialized countries and the developing and under developed<br />

world receives. With this trend, there exist great disparities with poorer nations having little or no<br />

access to things considered necessities in other countries.<br />

Various sectors of the economies of poorer countries can be identified as lacking certain basic needs.<br />

This challenge can however be easily addressed through effective global partnership. Areas of much<br />

concern are in the availability and distribution of drugs and medicines, provision of basic education and<br />

services such as electricity, telephone and internet.<br />

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<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

Also, as a step to mitigate poverty through global partnership in times past, great effort has been made<br />

in the area of debt relief through programs such as the HIPIC Initiative of the World Bank and the<br />

International Monetary Fund (IMF). HIPIC for instance created a framework for all creditors, including<br />

multilateral creditors, to provide debt relief to the world’s poorest and heavily indebted countries, and<br />

thereby reduce the constraint on economic growth and poverty reduction imposed by the debt build-up<br />

in these countries.<br />

However in terms of poverty reduction, two key questions have been raised: first, to what extent has<br />

micro finance made a lasting difference in bringing households out of poverty on a permanent basis?<br />

Second to what extent micro finance does program which the “core poor” and not just the better off<br />

among the poor?<br />

I do agree with seasoned advocates of Microfinance, that, microfinance alone cannot eradicate poverty.<br />

Micro finance is not the solution to global poverty, but neither is help, or education, or economic<br />

growth. There is no one single solution to global poverty. The solution must include a broad array of<br />

empowering interventions and micro finance, when targeted to the very poor and effectively run, is one<br />

powerful tool (Daley-Harris, Pollin and Montgomery, 2007, p.1).<br />

Ladies and gentlemen, I hope that we will have a fruitful discussion and that at the end of the<br />

conference we will be able to come out with practical ways of mitigating poverty through global<br />

partnership.<br />

Thank you all!<br />

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Executive Summary<br />

<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

At the dawn of the 21st century we are still a long way from achieving what has eluded humanity for<br />

thousands of years, a world free from hunger and poverty. The past thirty years, however, have brought<br />

us closer to reaching this goal in a large part of the developing world. The lives of millions have been<br />

transformed at a pace unparalleled in human history and to an extent that would have seemed<br />

unthinkable only a generation ago.<br />

However, there is no room for complacency. Even today, close to 1.2 billion people – a fifth of the<br />

world’s population – continue to live in conditions of abject poverty. Almost 800 million people in the<br />

developing world are chronically hungry. A basic right, the right to adequate and nutritious food, which<br />

most people take for granted, remains a distant dream for those who fight with food shortages every<br />

day of their lives. The presence of deep poverty and hunger on such a vast scale in a world of apparent<br />

opulence is a moral outrage.<br />

What is encouraging is that the international community has adopted the reduction of poverty and<br />

hunger eradication as overarching goals for development. Starting in the early 1990s, targets have been<br />

agreed upon for the reduction of poverty in its various forms and dimensions. Goals have been set for<br />

reducing poverty, raising school enrolment, moving towards gender equality, cutting infant and<br />

maternal mortality, improving access to reproductive health services, and adopting national strategies<br />

for sustainable development. In addition, at the World Food Summit, held in<br />

Rome in 1996, all nations committed themselves to the goal of halving the number of undernourished<br />

people from around 800 million to 400 million by 2015. Together, these targets have been adopted in<br />

the Millennium Development Goals which offer the promise of making the world a better place for the<br />

whole of humanity.<br />

The dimensions of hunger and malnutrition are alarming and cannot leave anyone indifferent. An<br />

estimated 174 million under-five children in the developing world were malnourished in 1996-98, and<br />

6.6 million out of 12.2 million deaths among children in that age group are associated with malnutrition.<br />

Hunger is an important cause as well as an effect of poverty. The effects of hunger go beyond its terrible<br />

toll on those who suffer from it. Hunger has substantial economic costs for individuals, families and<br />

whole societies. Labour, often the only asset of the poor, is devalued for the hungry.<br />

Mental and physical health is compromised by lack of food, cutting productivity, output and the wages<br />

that people earn. Chronically hungry people cannot accumulate the financial or human capital which<br />

would allow them to escape poverty. And hunger has an inter-generational dimension, with<br />

undernourished mothers giving birth to underweight children. In societies where hunger is widespread,<br />

economic growth, an essential element in sustainable poverty reduction, is severely compromised.<br />

Who are the poor and what is the principal source of their livelihoods? Nearly three quarters of the poor<br />

in developing countries live in rural areas. And the rapid increase in urban poverty can be explained by<br />

the decline of agriculture and the rural sector. The rural face of poverty, human misery and hunger<br />

indicates that the battle for hunger and poverty alleviation will be won or lost in rural areas.<br />

Many of rural poor are small farmers who are at the edge of survival or they are land-less people<br />

seeking to sell their labour. They depend on agriculture for their earnings, either directly, as producers<br />

or hired workers, or indirectly in sectors which derive their existence from farming.<br />

Trading, transportation, processing, involving large numbers of small entrepreneurs, are necessary for<br />

agriculture but at the same time they depend on farming activities for their survival.<br />

If we are to bring about a rapid reduction in poverty and hunger this will require a two-pronged<br />

strategy. On one hand, direct measures have to be taken to enhance the access of those in extreme<br />

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<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

poverty to the food they need for an active life: this empowers them to break out of the hunger trap<br />

and allows them to participate fully in development processes. At the same time, efforts must be<br />

stepped up to promote broad-based agricultural and rural development which will create the<br />

opportunities for a sustainable exit from poverty. These two elements of the proposed strategy are<br />

essential for rapid, substantial and sustainable reduction in poverty and hunger. They are also mutually<br />

reinforcing since advancement in one improves the effectiveness of the other. When feeding<br />

programmes and food-based safety nets are supplied from local production, this leads to a double<br />

benefit: not only are the hungry fed but local markets for food expand, opening income earning and<br />

employment opportunities for the poor.<br />

The responsibility for escaping from hunger and poverty rests first and foremost with the individuals<br />

themselves, and then with their families, communities and governments. Under international human<br />

rights legislation, governments have an obligation, when private action fails,<br />

to ensure that people can enjoy their right to adequate food. The proportion of public expenditure<br />

which developing countries now devote to agricultural and rural development and food security is,<br />

however, far from adequate, especially in countries where food deprivation is highest, implying a need<br />

to adjust public finance priorities<br />

However the international community has important roles in supporting national endeavours, not least<br />

to help governments, especially those of low income countries, to meet the costs of the necessary<br />

investments to the extent that these cannot be met by their own resources.<br />

And yet there remains a conspicuous gap between the implied acceptance of global responsibility for<br />

eradicating hunger and poverty and the extent to which concrete action has been taken nationally and<br />

internationally. In spite of the obvious benefits, resources for programmes related<br />

to food and nutrition to benefit the needy, seem to be only a fraction of what is required to make<br />

a substantial difference. There is a visible and worrisome downward trend in the resources, private and<br />

public, directed towards agricultural and rural development, especially in those countries where hunger<br />

and poverty are widespread. This trend has been particularly pronounced in the programmes of the<br />

international financing institutions as well as in those of many bilateral donors and national<br />

governments, in spite of reiterated commitments to expand investment in agricultural and rural<br />

development. For the most part, instead of meeting their declared goal of increasing their support for<br />

agriculture and rural development, most donors have been partners to a progressive decline. For poor<br />

countries with low capacity to mobilise sufficient amounts of either domestic savings or foreign direct<br />

investment, substantial flows of <strong>Of</strong>ficial Development Assistance including multilateral lending are<br />

required to create the conditions (capacity building, infrastructure, public goods and institutions) for<br />

attracting private capital into agriculture, whether domestic or foreign.<br />

International trade offers opportunities for developing countries to expand into new markets and<br />

products and to improve growth and food security prospects. While there are potential gains from freer<br />

trade in farm products, the actual progress made in the ongoing negotiations has been limited so far,<br />

and the benefits remain modest. If further liberalisation focuses too narrowly on a removal of OECD<br />

subsidies, the lion’s share of gains will accrue to developed country consumers and taxpayers. More<br />

important for developing countries are: a removal of trade barriers for products in which they have a<br />

comparative advantage and a reduction or reversal of tariff escalation for processed commodities; more<br />

and deeper preferential access for the poorest of the least developed countries; open borders for longterm<br />

foreign investments (FDI); and improved quality assurance and food safety programmes that<br />

enable developing countries to compete more efficiently in markets abroad. The resources gained by<br />

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<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

trade liberalisation and reductions in domestic protection could be channelled into additional<br />

development funding.<br />

Serious consideration must be given to possible new financing mechanisms, given their potential<br />

importance in transferring resources between developed and developing countries and hence the<br />

extent to which they could supplement <strong>Of</strong>ficial Development Assistance. While the call for a significant<br />

rise in ODA is very welcome, measures have to be taken to ensure adherence to agreed targets.<br />

Proposals have to be made which would ensure smoother and more dependable replenishment<br />

arrangements especially regarding concessional loan funds administered by the IFIs.<br />

It is important also that credible recommendations are made on the financing of an expanded flow of<br />

the global public goods – now in desperately short supply and competing with ODA – required to ensure<br />

the smooth operation of the processes of globalisation and the sustainable management of the world’s<br />

resources<br />

The Rome-based UN Organisations concerned with poverty, food and agriculture believe that the<br />

International Conference on Financing for Development must identify the extent of funds, whether<br />

domestic or international, needed to achieve the internationally agreed goals, especially those for<br />

hunger and poverty reduction. We firmly believe that it is fundamentally wrong to consider assistance to<br />

the poor and hungry an act of charity. Eradicating extreme poverty and hunger is a moral imperative,<br />

but it also makes great economic sense. Our work and the work of others clearly demonstrate that it is<br />

in the self-interest of the international community, rich and poor countries alike, to eradicate hunger<br />

and poverty wherever it appears. Eradicating hunger and poverty is an investment with high payoff in<br />

terms of peace and political stability, overall development and prosperity.<br />

The slow progress in meeting the internationally agreed goals points to the need not only for increasing<br />

the volume of resources devoted to this effort, but also to target them more effectively.<br />

International funding for hunger eradication and agriculture and rural development needs to rise to a<br />

scale commensurate with the problem and be advanced under affordable terms and conditions which<br />

do not lead to increases in developing country indebtedness.<br />

THE VICIOUS CIRCLE OF POVERTY AND HUNGER<br />

Poverty and hunger: recent trends and future scenarios<br />

5. The international community has pledged to halve poverty and hunger by 2015. But who are the poor<br />

and the hungry? How many are there? Where are they located? What is the relationship between<br />

hunger and poverty? The next two sections address these questions and emphasize the urgency of the<br />

fight to reduce hunger.<br />

6. On the basis of the “one-dollar-a-day threshold”, there are 1.2 billion poor people in developing<br />

countries. <strong>Of</strong> these, 780 million suffer from chronic hunger, which means that their daily intake of<br />

calories is insufficient for them to live active and healthy lives.<br />

7. Extreme poverty remains an alarming problem in the world’s developing regions, despite the<br />

advances made in the 1990s. Progress in poverty reduction has been concentrated in Asia and especially<br />

East Asia. In all the other regions, the number of people in extreme poverty has increased. In sub-<br />

Saharan Africa, there were 58 million more poor people in 1999 than in 1990.<br />

8. World Bank projections (World Bank, 2001) show that by 2015, the proportion of people living below<br />

the one-dollar-a-day poverty line will be 12.3 percent as compared to 29.0 percent in 1990 – well below<br />

half the 1990 proportion. The projections assume substantially higher economic growth rates than<br />

experienced in the recent past. If the assumptions turn out to be accurate, the MDG of halving the<br />

proportion of people in poverty world-wide between 1990 and 2015 will have been met.<br />

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<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

However, even using the optimistic growth assumptions, in sub-Saharan Africa nearly 40 percent of the<br />

population will still be in poverty by 2015 while there will be 45 million more poor people in the subcontinent<br />

than in 1999. Clearly, there is no room for complacency.<br />

9. The proportion of hungry people in developing countries was reduced by 3 percentage points in the<br />

1990s, despite population growth. Although this constitutes progress, the prevalence of hunger is still<br />

unacceptably high. At the start of the twenty-first century, in a world of conspicuous affluence, 34<br />

percent of the people in sub-Saharan Africa suffer from chronic hunger (Figure 1).<br />

This means 24 million more undernourished people at the end of the decade than at the beginning.<br />

10. Progress in reducing the number of undernourished has been alarmingly slow. The target set at the<br />

1996 World Food Summit was to halve the number of undernourished people by 2015 from their<br />

number in 1990-92. The latest data show that the number of undernourished is falling by 6 million a<br />

year. This means that the annual rate of reduction has to be stepped up to 22 million.<br />

Hunger and poverty: exploring the reverse linkages<br />

13. Widespread hunger and malnutrition in a world of plentiful food implies that extreme poverty is the<br />

root cause of undernourishment. It is not always understood, however, that hunger and malnutrition<br />

(including micronutrient deficiencies) are in turn major causes of poverty. They affect the ability of<br />

individuals to escape poverty in several ways (Box 1) through:<br />

● Reducing the capacity for physical activity and hence the productive potential of the labour of those<br />

who suffer from hunger – and that is usually their only asset.<br />

● Impairing people’s ability to develop physically and mentally, retarding child growth, reducing<br />

cognitive ability and seriously inhibiting school attendance and performance – thus compromising the<br />

effectiveness of investment in education.<br />

● Causing serious long-term damage to health, linked to higher rates of disease and premature death.<br />

● Passing from generation to generation: hungry mothers give birth to underweight children who start<br />

life with a handicap.<br />

● Contributing to social and political instability that further undermines government capacity to reduce<br />

poverty.<br />

Chronically undernourished people are, therefore, caught in a hunger trap of low productivity, chronic<br />

poverty and hunger.<br />

Hunger and conflict<br />

14. During the last decade, food insecurity and malnutrition appear to have contributed to an increasing<br />

frequency of crisis events as well as to the vulnerability of countries to shocks. Most of today’s armed<br />

conflicts and natural disasters are concentrated in regions heavily dependent on agriculture and in<br />

countries with a high proportion of food-insecure households and classified by FAO as “low-income food<br />

deficit”.<br />

15. As well as being a consequence of a conflict, food insecurity can be the cause and lead to conflict.<br />

Very few new conflicts start in a food secure environment. Hunger may induce conflict when people feel<br />

they have nothing to lose and military service offers a free meal and the power that goes with touting a<br />

gun.<br />

16. The impact of various crises will be also amplified when they affect a population that is already<br />

vulnerable and weakened by food insecurity. People in poor and food insecure countries are more likely<br />

to die from natural disaster than those who have developed better coping strategies to protect<br />

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<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

themselves. Crises often create the opportunity for underlying micronutrient deficiencies to develop<br />

into large outbreaks, for instance of pellagra or scurvy.<br />

Evidence on the Cost of Hunger<br />

There is evidence that 46 million years of productive, disability-free life were lost in 1990, the result of<br />

lost social productivity caused by four types of malnutrition: stunting and disorders related to iodine,<br />

iron and vitamin A deficiency. 156 million children under five in developing countries suffer from protein<br />

energy malnutrition. 90 percent of all anaemic pre-schoolers and expectant mothers live in developing<br />

countries. Vitamin A deficiency is the primary cause of preventable eye defects and blindness in<br />

children.<br />

About 17 percent of infants suffer from intra-uterine growth retardation, an indication of poor maternal<br />

nutrition. Low birth weight means a high risk of illness and death during infancy and reduced work<br />

capacity and strength in adulthood. 12 million deaths each year among children under five in the<br />

developing world – a staggering 55 percent are associated with malnutrition.<br />

A study of Sierra Leonean agriculture showed that, on average, a 50 percent increase in calories per<br />

consumer equivalent would increase output by 16.5 percent, or 379 kg of food. The findings show that<br />

the lower the calorie intake is, the more significant output response is to increased calorie intake. For<br />

example, based on a daily intake of 1 500 calories per consumer equivalent, a mere 10 percent increase<br />

in calorie intake would increase output by nearly 5 percent.<br />

A study in Ethiopia has shown that a 10 percent improvement in weight-for-height and Bod MasIndex<br />

(BMI) would lead to a 23 and 27 percent increase in output and wages respectively. In the same study<br />

height, an indicator of past nutritional experience is found to be a significant determinant of wages, with<br />

a person who is 7.1 cm. above the average height, earning about 15 percent higher wages.<br />

An FAO study found that raising Dietary Energy Supply (DES) to 2 770 kcal/day in countries in which the<br />

average is below that level, would increase per capita GDP growth by 0.34 to 1.48 percentage points per<br />

year in countries where DES is below that level. Improved nutrition affects economic growth through<br />

greater labour productivity and life expectancy.<br />

3 percent of GDP every year is lost in some Asian countries through productivity losses resulting from<br />

stunting and iodine and iron deficiencies. Given that GDP growth rates in these countries were up to 7<br />

percent per annum in the nineties – it follows that large losses in GDP have taken place.<br />

50 percent of the economic growth in the <strong>United</strong> Kingdom and France between 1700 and 1900 resulted<br />

from improvements in nutrition and health, according to Nobel laureate Robert Fogel.<br />

17. The lack of sufficient resources for eradicating hunger will continue to put at risk the life of many<br />

vulnerable groups and will be one of the elements which contribute to the resurgence of emergencies.<br />

Therefore, savings from conflict avoidance should be understood as “returns” to aid.<br />

Following emergencies, humanitarian interventions are often necessary, but they are expensive and do<br />

not generally tackle the underlying causes of the crises. The need for relief will remain as long as<br />

vulnerable people do not get access to adequate food and to gainful economic opportunities.<br />

Timely investment in food , agriculture and rural development can help to break the repetitive cycle of<br />

hunger and conflict.<br />

18. The preceding discussion shows that alleviating hunger for those who suffer from it allows them to<br />

fully develop their physical and mental skills, increases their productivity and allows them to fully<br />

participate in the development process. Hunger reduction should therefore be thought as a productive<br />

investment in addition to a pressing moral obligation. Wisely conceived policies that target hunger<br />

directly and in a timely fashion, can break the “hunger trap”.<br />

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<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

POVERTY, AGRICULTURE AND RURAL DEVELOPMENT<br />

The rural face of poverty and hunger and the role of agriculture<br />

19. The slow pace of poverty and hunger reduction points to an urgent need for strategies that better<br />

target the areas where poor people live and the activities on which their lives depend. A successful<br />

strategy for alleviating poverty and hunger in developing countries must begin by recognizing that they<br />

are mainly rural phenomena and that agriculture is at the heart of the livelihoods of rural people.<br />

20. Today, 75 percent of poor people in developing countries live in rural areas. In 2020, when the<br />

majority of the world population is projected to live in urban areas, 60 percent of poverty will still be<br />

rural poverty. And rural decline is among the root causes of premature urbanisation and urban poverty.<br />

There are several arguments supporting a rural focus for development aimed at poverty reduction<br />

(IFAD: Rural Poverty Report):<br />

● Major differences in incomes, poverty, nutrition, health and education between towns and rural areas<br />

are not shrinking: most of the “dollar-poor” will still be rural in 2020.<br />

● The decline in rural poverty has slowed in recent years; it was much more rapid in 1970-85.<br />

● Addressing rural poverty cuts urban poverty by reducing migration.<br />

● Reducing rural poverty depends on raising the productivity of the poor – but most approaches to<br />

urban poverty are welfare-oriented.<br />

● Increases in worker/child ratios provide a window of opportunity for poverty reduction. The rural poor<br />

need female empowerment and improved health and education to permit reduced fertility.<br />

● Aid goes increasingly to non-rural sectors, where most of the poor do not live or work. It is<br />

disproportionately distributed among countries, to the detriment of countries in greater need.<br />

21. Agriculture is the principal driving force of the rural economy and, for those developing countries<br />

without substantial mineral resources, often the whole economy. Dependence on agriculture for<br />

economic growth and export earnings increases with the prevalence of hunger, and so does the<br />

proportion of people whose lives depend on the rural economy (see Table 1 ).2 Box 2 demonstrates that<br />

massive, sustainable poverty and hunger reduction is inconceivable without growth in rural economies,<br />

and summarizes the evidence, showing the potential of agricultural growth to reduce poverty.<br />

22. Hunger and poverty reduction require that the incomes of poor people and the sources from which<br />

they derive their livelihoods be enhanced. Therefore, pro-poor income growth needs to be encouraged.<br />

The question is: under what circumstances is income growth pro-poor? The short answer is that income<br />

growth originating in agricultural development will reduce poverty, provided that it does not occur in a<br />

context of high inequality in asset ownership.<br />

23. Rural households generate income from agriculture or employment in non-farm rural activities.<br />

Agricultural income originates from subsistence production, revenues from the sale of produce or<br />

employment in agriculture. The rural non-farm sector provides goods and services linked to agriculture,<br />

such as input preparation, repair of machinery and implements, output processing, transport and<br />

marketing. Income earned from agricultural activities creates demand for the output of small rural<br />

enterprises. It takes few skills to establish or work for such enterprises, so they are readily accessible to<br />

the poor. Initial productivity-induced growth in agricultural output will create multiplier effects in nonfarm<br />

economies, increasing the incomes of those involved. It will also raise the incomes of those directly<br />

engaged in farming.<br />

24. This process cannot work, however, if there are marked inequalities in access to agricultural and<br />

other assets, especially land. Large capital-intensive holdings tend to use inputs imported from abroad<br />

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<strong>United</strong> <strong>Nations</strong> <strong>Students</strong> <strong>Association</strong><br />

<strong>University</strong> <strong>Of</strong> <strong>Ghana</strong>, <strong>Legon</strong><br />

or from large towns and income is often invested outside the immediate area on which the farm is<br />

located; interaction with local economies will be limited. Small farms are much more fully integrated<br />

with local markets even if, ultimately, they are significant suppliers of export goods.3<br />

TOWARDS A TWIN-TRACK STRATEGY<br />

25. The above discussion shows that achieving massive and sustainable poverty reduction entails<br />

(a) targeting hunger directly so as to increase the productivity and productive potential of those who<br />

suffer from it, and allow them to take advantage of the opportunities offered by development and (b)<br />

stimulating agriculture and rural development, both essential for both overall economic growth and<br />

sustainable reductions in poverty. The productivity handicap caused by hunger must be dealt with<br />

directly if agricultural development is to proceed as it should. People in abject hunger must have enough<br />

to eat if they are to share the benefits of agricultural and rural growth. The vicious circle of<br />

undernourishment leading to low productivity and growth perpetuates underdevelopment and hunger.<br />

Hungry people must have better access to food, which requires direct assistance. The vicious circle must<br />

be broken.<br />

Recent literature explores the role of agriculture in poverty reduction. Some results are summarized<br />

here.<br />

_ Primary and tertiary sector growth reduce poverty, secondary sector growth has no significant impact<br />

on poverty.<br />

_ Growth in rural areas reduces poverty in both rural and urban areas, urban growth reduces poverty<br />

only in urban areas.<br />

_ Growth in small-farm production reduces the number of people in poverty and reduces its severity:<br />

the consumption of the poorest may be increased.<br />

_ In countries where income inequalities are small, labour productivity increases in agriculture are<br />

consistently more important than those other sectors in generating income increases (Timmer, 1997).<br />

_ In sub-Saharan Africa, sustained growth in rural incomes, when widely distributed across households,<br />

is capable of unlocking significant additional growth.<br />

Email: gimun100@yahoo.com<br />

Blog: www.thegimun.wordpress.com

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